Asheville considers affordable housing mandate

A City Council committee discussed Tuesday requiring housing developers to include a certain percentage of affordable units when they build a new project but took no action.

City government is looking for ways to encourage construction of more affordable housing units like those in The Larchmont, a North Asheville apaartment complex.
(Photo:
Mark Barrett
,
mbarrett@citizen-times.com
)

ASHEVILLE – Should city government require housing developers to include a certain percentage of affordable units when they build a new project?

A City Council committee batted the idea around a bit Tuesday after hearing a staff report on how such a requirement could work. But the committee took no action.

Councilman Gordon Smith, chairman of council’s Housing and Community Development Committee, said after the meeting that instituting what is called mandatory “inclusionary zoning” is a possibility, but that city government will probably look first to other solutions to the city’s shortage of affordable housing.

Housing costs in the Asheville area are typically similar to those in larger North Carolina cities but local wages have not kept up with statewide averages in recent years. City Council has made increasing the city’s supply of affordable housing a top priority and Smith said he hopes the committee will send goals and suggested policy changes to council for consideration this fall.

Assistant City Attorney Jannice Ashley told Smith’s committee Tuesday that three municipalities — Carrboro, Chapel Hill and Davidson — have mandatory inclusionary zoning and a handful of others have requirements for certain situations. Ordinances might require 12.5 percent or 15 percent of homes in a new development be sold or rented at levels the municipality considers affordable, she said.

Her report says such a requirement may work better than voluntary methods because it “can be applied to the broadest number of developments and produce a predictable quantity of affordable units at a level that remains in step with overall growth.”

But, she said, developers and buyers may oppose the idea of being forced to subsidize production of less expensive units and it “can lead to a slight increase in prices” for other homes in a development. Also, there is some question whether North Carolina municipalities have legal authority to impose such a requirement, Ashley said.

The requirements “do work where it is a hot economy, where the developers want to build,” city Planning Director Judy Daniel said.

Local appraiser Mac Swicegood, a longtime critic of city regulatory policies, said after the meeting that there are better options.

Mandating construction of affordable housing in a project “sounds good on paper, but in reality it’s not,” he said. “What we should be concentrating on is getting people to work, so more regulation is not the way to do it.”

Other forms of inclusionary zoning include allowing a developer to build more units on a site if a certain percentage of affordable units are included, sometimes called a “density bonus,” or requiring them if a project requires conditional use zoning.

Many larger projects in the city come before City Council via the conditional use zoning process, in which a developer agrees to certain restrictions in hopes of receiving city approval for a project.

Those options are less likely to be overturned in the courts, Ashley said, but they would probably result in construction of fewer affordable units than the mandatory approach.

City rules already allow density bonuses tied to construction of affordable housing in some situations, but that option is rarely employed. City officials have discussed increasing the areas of the city where a density bonus is available.

The city does not have an explicit policy tying affordable housing construction to conditional use zoning. However, some developers have included affordable housing in projects in the past in apparent attempts to win City Council approval.

Smith brought the issue up during at least one recent council meeting in which housing projects were considered, saying council approved several projects in 2013 but has seen few affordable housing proposals.